Monday, July 18, 2011

Nifty corrected as anticipated! Nifty path ahead...

Nifty Daily chart:

Nifty 10 mins:

Nifty daily chart shows that we are moving in a complex correction of W-X-Y. We have completed W-X- a of Y. We have either completed b of Y either at the high of 5750 or we still are in wave b of Y.

Nifty 10 mins chart shows minute degree wave counts. It is very difficult to explain the nesting of wave counts and it can be very confusing. On 10 mins chart, blue line shows one possibility whereas red line shows the other possibility. A break of 5541 is deciding factor to confirm which possibility is developing. Friday’s consolidation completes Time correction but we might be moving in an expanding triangle rare pattern and one leg e to the upside (shown in red) is pending which might take us near 5682 from where the leg (c) down shall start.

To avoid the complexity and confusion of wave counts, in short we wait for negative confirmation below 5541. As long as 5541 is not taken out on downside we might see a rally till 5682 which shall act as a strong resistance level!